New Delhi: Central ministries and departments will have to buy electric vehicles (EVs) when they replace their ageing staff cars, and can spend up to Rs 20 lakh on each one. The Department of Expenditure in the Finance Ministry set out the change in an office memorandum dated November 10.
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The memorandum said that from now on, ministries and departments should ordinarily buy EVs when their existing internal combustion engine (ICE) staff cars are condemned or replaced. “EVs shall be the default and preferred choice for procurement,” it said.
A ministry or department can still buy an ICE vehicle if it considers EVs impractical. It will need a properly justified proposal, which the Department of Expenditure will consider for relaxation case by case. “Such a proposal may be referred with the approval of the Secretary of the Administrative Ministry/Department and concurrence of the Financial Adviser,” the memorandum added.
The Finance Ministry said it was revising the Net Dealer Price (NDP) ceiling for buying both EVs and ICE vehicles. It gave its reasons as promoting electric mobility, cutting dependence on fossil fuels, and taking account of current market prices and the cost of a vehicle over its life.
Under the revised limits, ministries can pay up to Rs 20 lakh for an EV. For ICE vehicles, including petrol, diesel and hybrid cars, the ceiling is Rs 10 lakh, half the EV limit. Both are above the Rs 6 lakh NDP ceiling in the 2022 instructions on buying and hiring cars for ministries and departments.
The Finance Ministry said all ministries and departments will continue to follow the 2022 instructions that mandate hiring EVs. Any ministry that considers it necessary to hire ICE vehicles must refer the proposal to the Department of Expenditure, which will consider relaxation case by case.
The instructions came as the government works to speed up EV adoption as part of a broader push for clean mobility, energy security and lower carbon emissions. Its policy approach combines financial incentives, support for domestic EV manufacturing, the build-out of charging infrastructure, and measures to encourage wider adoption by consumers and institutions.